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Monday, October 10, 2011

Stanford Hospital sued $20M over data breach

Twenty million dollars for 20,000 patients: That's how much Stanford Hospital & Clinics stands to owe if the patients win the class-action lawsuit against the leading hospital. Stanford is vowing to fight the lawsuit filed by the patient, who represents thousands of patients whose information was exposed online for almost an entire year, reports Palo Alto Daily News.

The data breach was discovered on Aug. 22, and the information was removed the next day when Stanford Hospital began an "aggressive investigation," according to a Stanford press release.

Stanford pointed to the billing contractor (and co-defendant) Multi-Specialty Collection Services LLC (MSCS) as the culprit for mishandling patients' data. The hospital sent the encrypted data to MSCS, according to Stanford Hospital. MSCS's executive vice president allegedly created an unencrypted electronic spreadsheet and sent it to an unauthorized person to create bar graphs and charts. The unnamed third party allegedly posted it to the public Student of Fortune, a homework help site.